Well known Digital payment gateway provider “PayU” has acquired a controlling stake in Mumbai based consumer lending platform known as “PaySense” and all its assets at a valuation of $185 million. PayU also said it will merge LazyPay with PaySense.
Additionally, PayU will invest around $200 million in their newly acquired venture. Around $65 million of this amount will be immediately invested, while the balance corpus will be disbursed over the next 24 months.
As a part of the deal, Prashanth Ranganathan, existing chief executive of PaySense will lead PayU’s credit business in India as the CEO of the new enterprise. Ranganathan will continue to retain a stake in the merged enterprise, while all other investors and shareholders will exit. PaySense’s existing management team will also become part of the PayU’s credit team.
PayU’s products are mainly focused on students, salaried employees, and consumers with no credit history. LazyPay’s “Credit product” combined with PaySense’s “Strong analytics and risk management capabilities” will make it possible to serve customers without a credit history.
Customer data will be extracted from sources such as bank statements,smartphone, and certain social media platform.After this merger, PayU will also be able to co-lend to consumers using third parties such as banks & non-banking financial companies (NBFC).
PaySense currently provides online loans for different purposes including for personal use,vehicle financing,loan for marriages, vacations and home renovation. It is now claims to manage an AUM (assets under management) in excess of ₹ 500 crores. So far, PayU over 5.5 million registered customers with loan disbursement of over ₹ 1,100 crores.
While, LazyPay provides users with a pre-approved credit line starting at ₹5,000 and above. Users can make their online purchases using the credit line, and settle bills on monthly basis with LazyPay.
This merger will be the next step in providing online credit to Indian customers.